Citigroup to Pay $7 Billion to Resolve Mortgage Probe

7/14/2014 10:34AM

Citigroup will pay $7 billion to settle the U.S. government's accusations that it misled investors about the quality of mortgage securities it sold in the run-up to the financial crisis. Saabira Chaudhuri joins MoneyBeat. Photo: Getty Images.

This transcript has been automatically generated and may not be 100% accurate.

... been been been been been been been ... the Justice Department obtained a landmark civil resolution with Citigroup ... totaling seven billion dollars in fines and consumer relief ... would press the banks involved in a scheme to sell fraudulent securities ... were backed by toxic loans ... that was US Attorney General Eric holder announcing that Citigroup will pay seven billion dollars to settle the U S government's at accusations ... that it misled investors about the quality of mortgage securities it sold in the run-up to the financial crisis ... good morning and welcome to MoneyBeat I'm Steber slow low in today for Paul vignette ... the settlement comes in Citigroup also reported quarterly results ... here to break it all down is Wall Street Journal report that Sabra Chowdhry ... Sabah thanks for joining us spicy so quite a morning of the banking reporter my family makes a anxiety that goes on to the sentiment show doubt that about seventy and has seven billion dollars likes you mention is the overall number ... full point five billion ... is actually attached supplements and two point five billion pounds in concealment duty ... I aam ... Citigroup has come in aam we immediately looking at something like that at ... three hundred and sixty three million ... and did did you Gomez's identity looking for a twelve billion and so if this is about or care how again to see that side versions there and how they've now come to the seven billion a year and I think invest as a generally happy and in Shea is what up strongly and then Citi could actually reported earnings in on the go ... and chase jumped even more on the actually had quite a strong quarter despite the fact that the long entry point eight billion dollars giants ... just in the second quarter tied to the settlement ... so strong about the quarter ... so the actually beat analyst estimates once you strip out that the coach actually be down assessments on I pushing earnings by a large scale to become the new ... um I think nobody's expecting baby to be quite that strong one of the big reasons that they did so well is that they trading revenue was actually ... much next week ... and the CFO had warned it would be me ... so it looks like Juno I'm the last peak of me you actually very strong for treating ... REIT's SOS top stocks that there were the stairs up about three percent right now and if you think the shares of the other big banks there also rising and I think that's because the JPMorgan and Goldman Sachs report earnings tomorrow and then you have banker MC on Wednesday ... and then moments any on Thursday ... and the owner had be fixed income alacrity and trading on news ... that the activity seeking hot from the fact that you ... might be the month that actually helps cheating kind of ... yes so for Citigroup now seven billion dollars settlement out of the way here what is next for the bank ... that is a good question and it is obviously a lot of things floating around I think Fred and the disciples on that that I and the Essen as it into a mortgage back securities litigation ... importantly it also releases them from CDU and identity in the future ... that something the GP molding didn't actually get on the head panel and simmer assessment backing them up for thirteen billion dollars ... so that we acting Citigroup's got a lot of issues on the week ... but there's always stuff floating around with the bank's unit is liable and is ... this kind of the ethics that so I think it just remains to be seen what's next but this is a big deal for them to get ... Lee and the potential dividend in the future ... again the I think remains to be seen they didn't know about that as on the media call this morning day conference call is going on as we speak to me so ... that might be some some talk about but I think I like C consummation next year by back to ... Sabah Chowdhry thank you so much for joining us